For years, the cabinet tolerated speculative land trading, only excesses were punished by the disciplinary court. On Thursday, the minister said in the House of Representatives that speculative land trade is ‘really an undesirable development’, which the cabinet wants to change quickly. The cabinet will come up with new rules before the start of the summer.
Thousands of victims
Research by RTL News earlier this year showed that private individuals are massively duped by speculative land trading. With the help of civil-law notaries and the Kadaster, land traders cut up pieces of agricultural land and resell them to private individuals, for example as a pension provision.
The land dealers promise large profits if houses are built on the fields, but in practice this hardly ever happens and buyers are left with much too expensive land that they cannot lose. It’s called ‘wind trading’, which only benefits the selling traders.
Prohibition is on the table
Since RTL News reported, VVD and D66 have stepped into the breach for this growing group of victims, who have sometimes lost tens of thousands to hundreds of thousands of euros through land trade. D66 MP Faissal Boulakjar called land trade ‘deliberate deception aimed at duping consumers’, VVD MP Fahid Minhas even suggested a ban on land trade.
Minister de Jonge agreed with the major concerns of these groups, but also said that putting an end to speculative land trading is not easy. A ban is difficult because property rights are firmly enshrined in law. The minister does see several possible solutions that will make it very difficult for land traders to continue offering these types of investment products.
What the cabinet will do is talk to civil-law notaries, who will continue to make speculative land trading possible. According to the Royal Notarial Association, notaries cannot be blamed and notaries cannot refuse their services to land traders.
Roll notaries
Minister De Jonge does not agree with this, he is emphatically looking to this professional group for a solution. “You would actually like the civil-law notary to inform buyers properly or to check whether buyers have informed themselves properly, what can civil-law notaries do in this regard?”
De Jonge also promised to take a closer look at Kadaster, the service that registers land use in the Netherlands and falls under his direct responsibility. Earlier RTL News revealed that the Land Registry sometimes splits plots after land traders have sold these plots twice.
Half of the lot remains
Buyers are then left with half of the plot they own on paper. But according to De Jonge, these are provisional splits that are not yet final. Here, too, he points to the civil-law notaries involved, who apparently supply incorrect information to the Land Registry. “This cannot be right, and Kadaster is working on that.”
In the video below you can see how the land trade can have a major impact on families:
In addition, the Ministry of Finance appeals to the Netherlands Authority for the Financial Markets (AFM). Since most buyers buy a piece of agricultural land as an investment, it would make sense to call in the existing regulator for this.
New measures
The transaction of a piece of agricultural land is not yet subject to AFM supervision. But whether this will offer solace is the question, AFM supervision of land trade could also give the impression that pieces of agricultural land are a serious investment option for consumers.
Minister De Jonge saw another threat. If a piece of farmland next to a town or village is interesting as a development location in the distant future, the fragmentation of these plots due to land trade is precisely a problem. “It is not helpful to sit with a whole bunch of owners if it eventually comes to housing,” said De Jonge.
The cabinet will soon come up with measures, he promised. “This is really an undesirable development, because of the area development and also because of all the other reasons. We are trying to get this sorted out before the summer.”
2023-05-11 12:17:07
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